INVENTORY MANAGEMENT
IMP. Inventory Management Policy
The IMP training program is designed to address various aspects of inventory management within manufacturing companies. It encompasses topics such as inventory size measurement, goal setting, categorization, prevention of unnecessary accumulation, safety stock management, the material requirements planning (MRP) process, and other relevant techniques.
Training Description
- Do you sometimes feel that the inventory lingering in your warehouse is no longer needed?
- Are you facing recurring obstacles, such as inaccurate inventory size data in the ERP system?
- After an unsuccessful promotional campaign, do you find yourself with excess packaging inventory again?
- Do you find production meetings filled with discussions about reasons for not achieving yesterday's plan?
- Are you too busy dealing with "fires," including outdated basic data, to organize essential material data?
- Are you uncertain if the current batch sizes effectively minimize total costs in the company?
- Are you contemplating the optimal frequency and quantity for inventory replenishment?
During the IMP training, we delve into comprehensive inventory management, exploring the underlying mechanisms that contribute to inventory accumulation. We discuss mechanisms that prevent the build-up of inventory and support the company in maintaining a healthy inventory structure.
To control inventory, we must first define what it means. For this purpose, we will discuss methods for measuring inventory size and setting inventory goals. We will categorize inventory, allowing control without excessive need to delve into details, as more details mean more work and greater uncertainty.
We will discuss ways to prevent the accumulation of unnecessary inventory. We will explore different approaches to determining the size of the purchase order quantity and production batch quantity. The starting point will be a cost analysis and an analysis of potential threats and constraints associated with both very large and very small batches. This will help us define various criteria for determining the batch size, especially in production. The discussions are based on examples from various industries.
A significant topic during IMP is the issue of safety stock. Should safety stock be maintained? How to link safety stock with customer service, external delivery timeliness, and production timeliness? How to determine safety stock using different methods? Where should safety stock be planned: on finished products, materials, or semi-finished products? What types of disruptions are safety stocks protecting us from? How large should safety stocks be? How often and by what methods should safety stock sizes be updated? What are the advantages and limitations of different approaches to safety stocks?
In the context of reviewing inventory replenishment methods, we will link back to previously discussed topics related to batch sizes and safety stocks. We will try to optimize the entire investment in inventory, considering purchasing costs, inventory costs, and the expected level of customer service.
We will also cover simplified inventory replenishment methods, addressing reasons for using simplified methods (not based on the MRP mechanism), the benefits of their use, and the associated risks, which are often underestimated.
We will emphasize preventing various threats in inventory management, as opposed to "putting out fires" – reacting to emerging threats.
After discussing the above topics, we will move on to the practical conditions and techniques for effectively using the MRP mechanism. We will pay attention to the necessary accuracy of basic material data and product recipes (BOM). We will examine various methods, indicating when and how much to order. We will discuss how to apply previously calculated safety stocks in our MRP systems.
During the training, we will build an "Implementation Guide." This "Guide" is a set of tasks that participants, using the knowledge from the training, can perform in their companies and create a complete or at least a partial Inventory Management Policy.
At every step, we emphasize the business context in which we find ourselves. We seek to understand the needs of our internal customers and ways to convey our needs to those for whom we are customers.
Learning Outcomes:
- Identify types and categories of inventory and learn methods to maintain a healthy inventory structure and prevent the accumulation of unnecessary inventory.
- Learn methods for determining and planning safety stocks to maintain customer service levels and production liquidity while controlling inventory size.
- Determine the purchase order quantity and production batch size to optimize costs associated with inventory.
- Understand the mechanism of Material Requirements Planning (MRP) in the context of configuring the most important tool parameters.
- Understand the benefits, limitations, and requirements of MRP as a tool for procurement and production planning and its usefulness in various industries and production types.
- Learn other than MRP methods of material planning and analyze their advantages and limitations.
- Acquire effective inventory management methods, considering factors such as demand dynamics, component delivery times, the breadth of the product portfolio, customer requirements, company priorities, and other factors influencing the selection of optimal inventory management techniques.
Sessions:
- Inventory management policy
- Measurement of inventory size and setting inventory goals
- Inventory categorization
- Preventing the accumulation of unnecessary inventory and managing inventory at risk of becoming obsolete
- Determining production and purchase batch sizes
- Safety stocks
- Simplified inventory replenishment methods
- Utilizing MRP results
- Mechanism of Material Requirements Planning (MRP)
Course Format:
- Online training: 4 days, 8 live sessions with a trainer, exercises, 10-15 min videos for selected sessions, printed Polish-language training materials.
- On-site training: 3 days, 8 sessions, exercises, printed Polish-language training materials.
- Interactive workshop based on a multimedia presentation and trainers' original materials.
- Participants perform practical exercises illustrating the discussed issues and proposing specific concepts for practical problem-solving.
- The training is based on examples discussing real challenges of companies from practically every production model – from production to order to project-based manufacturing.
- Action learning – post-training tasks.
- Participants receive practical materials containing model implementation plans.
- Handbook (printed) in Polish – for online training, sent before the training to the specified address.
- Diploma of completion of training signed with the MPM logo.
Recommended Introductory Training:
If you are considering implementing an Inventory Management Policy in your organization, want to optimize it, or would like to take care of inventory management processes in your company, check out our implementation path for: